Netflix Attacks Blockbuster Online

Blockbuster's online DVD rentals have attracted a patent-infringement lawsuit from Netflix. At issue are two patents. The first one, granted in 2003, concerns the method of letting users choose and return titles. The second relates to the waiving of late fees, obtaining new discs at no extra charge, and prioritizing want lists. For Netflix, the timing is interesting—that second patent was granted just last week! For Blockbuster, it's disastrous. The company is a billion bucks in the red, spent $300 million to set up Blockbuster Online, and has only one million subscribers, versus four million for Netflix. Compulsive letter writers, here's a hot question for your senators and congressthings: Why is the federal government granting business-methodology patents that squelch competition and raise prices for consumers?